“A Guide to Financial Intelligence and Commercial Awareness
…for aspiring Technologists.”
Last Updated – Mar’19 :: First Published – Nov’15
‘Techies doing ‘bean counting’, surely that is the role of the Finance Department – definitely not that of a technologist? Correct, but think again…
If this is your perception of business finance then I have news for you. According to Gartner, almost half of the capital expenditure in companies resides within technology. My experience is that the technology budgeted cost covers up to 15%, sometimes more, of the total revenue of a company and technology capital expenditure is close to 50% of the total capital expenditure budget. These are substantial numbers behind technology departments within organisations, operated mostly by technical people or ‘Techies’.
As more and more companies become increasingly digitally driven, the trend is that smart companies are investing more in their digital strategies and the conversion of technology innovation into revenue earning products and services.
Leading businesses in this technology age, will be the technologist, the IT leaders of today is becoming the business leaders of the future.
Independent of your position within an organisation, whether you are a business owner or leader, director, executive or manager, technical team lead or project manager, it is absolutely empirical for you to have a thorough understanding of the financials and to improve your commercial awareness. It is no longer enough to just have the expertise to be good at your job – you have to be business smart. Depending on your role, you might have access to various levels financial information of the organisation, division or department. Get your hands on it and familiarise yourself with the content. This financial information can be an understanding of the financial performance and health of the project or account you are working. It can be as simple as understanding what you are costing the business, what commercial value your cost add to the business and how this is calculated and reflected in financial reports and statements.
Continuous technology innovation is ever changing the business landscape and the demand for knowledge worker’s. The trend shows an increasing demand and higher expectation on highly skilled professionals that can work in an flexible way, embracing and adapting rapidly to change. This demand is increasingly fulfilled by a flexible professional that understands businesses just as well as being an expert. More and more knowledge workers are turning to independent contractor and freelance workers, starting their own businesses in the process. This is re-defining the employee-employer relationship towards a supplier-customer relationship or partnership. Technology workers are becoming business people.
Running your own business successfully, requires different skills than just being the best specialist – it requires you to be business smart with financial intelligence and commercial awareness.
How financially and commercially savvy are you as a technologist? Ask yourself the following questions:
- Do you understand how your role and actions impact your organisation’s ability to compete and perform in the market resulting in financial success?
- Can you monetise your cost and commercial value to your collegues and the business?
- How financially intelligent and commercially aware are you?
- How commercially aware is the staff involved in managing your business or operating your technical departments or working within your department or project team?
This book provides a concise overview of the most important financial functions, statements, terms, practical application guidelines and performance measures. It explains the different financial statements in more detail, the data that make-up the information provided within financial accounts. It provides an overview of the underlying financials in business operations, project management, marketing and sales. You will gain insight into how to identify and understand your target audience within the market you operate in and how to measure up against your opposition.
- You’ll learn the value that commercial awareness and financial intelligence bring to setting strategy, increasing productivity and efficiency and how it can support you in making more effective decisions.
- You’ll learn what the numbers really mean.